Earlier today, Merriam-Webster announced that pragmatic was their word of the year and the most searched word on their site in 2011. According to their press release “Pragmatic is not associated with any one event but instead describes ‘an admirable quality that people value in themselves and wish for in others, especially in their leaders and their policies.’”
As we move into 2012, and dozens of lists start to crop up predicting the future of IT in 2012, I figured it may be good to take a more pragmatic approach, focusing less on an idealistic vision of what may be possible in business intelligence, and more on what is practical, and impactful for companies’ bottom lines; in other words: a pragmatic approach to BI.
Align BI and Corporate Strategy
In their annual technology survey, McKinsey & Company found that companies are shifting their decision making to incorporate more data and analytics in almost all corporate functions. In our recent survey, though, we found that, across corporate functions, over 50% of business executives indicated that they had inadequate BI for one or more of their key areas of responsibility.
In order to align BI and corporate strategy, there needs to be a shared commitment to the success of both areas. BI teams need to understand, and articulate in their BI products, the strategies driving each of the functional areas. On the flip side, functional executives need to understand their companies’ BI capabilities (and limitations) and apply a business framework for using analytics.
Focus on Business Processes
In the same McKinsey survey, non-IT executives ranked the following as the top three IT priorities, in order of importance:
- Improving effectiveness of business processes
- Improving efficiency of business processes
- Providing managers with information to support planning and decision making
This is great news for BI teams, especially those who want to align BI and corporate strategy. Business processes are key links between corporate strategy and BI. They are the mechanisms organizations through which achieve their strategies. Business intelligence provides insight into these processes: from reporting on the historical performance of these processes, to examining the root cause of variance in these processes, to analyzing and predicting the future performance of these processes.
Having this insight, then, helps to improve the effectiveness and the efficiency of these business processes. And this insight is what managers need to support their planning and decision making.
Take a Phased Approach to Developing BI
In a previous blog post, we talk about how companies can evolve from line of business marts to enterprise data warehouses. One of the most crucial elements for making sure this is successful, though, is identifying and prioritizing BI opportunities. Doing so allows you to develop BI projects that provide the biggest bang for the buck for the organization first. As each project is deployed and the value is realized, the validity and overall value of the BI program increases.
Focus on Transactional Data
While there has been a great deal of attention paid to the impact of big data in 2012, from a pragmatic perspective, there’s more value to be gained in the next 12 months by leveraging the traditional sources of data associated with BI. As I mention before, there’s still plenty of work to be done with this data for most companies.
As many define it, “big data” deals with the rapid expansion in the variety and volume of information that companies will be expected to collect and analyze, and the velocity of which that data is captured and made available for analysis. In our survey, most functional area executives didn’t see the sources of data (i.e. the variety of data) often associated with big data is crucial to their core business functions. Additionally, most BI and IT executives who responded found that their IT infrastructure was sufficient to handle the volume and velocity of data they’re expected to encounter over the next year.
Business Intelligence in 2012?
While we’re sure 2012 will be a big year for business intelligence, I think the biggest change that will matter (i.e. the most pragmatic) will be to corporate cultures, as more and more executives and managers begin to generate a higher demand for data to support their decision-making. Who knows, maybe it’ll grow to the point where Merriam-Webster will make “analytics” its word of the year for 2012.
by Adrian Alleyne, Director of Market Research
© DecisionPath Consulting, 2011